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Home/GB Balancing Mechanism Summary – March 2019

GB Balancing Mechanism Summary – March 2019

Aurora’s Flexibility Market Summary provide a concise monthly review of recent events in key markets for flexible technologies. The initial focus is on the balancing mechanism and firm frequency response (FFR) markets with more ancillary services markets to be added over time.

Key highlights from the March report are:

  1. The average short and long system prices for March decreased 11% and 22% relative to February, to £62.2/MWh and £28.9/MWh respectively, tracking the 14% drop in wholesale prices as the weather grew warmer and gas costs continued to fall.
  2. System prices on 24th March were below -£50/MWh for 13 settlement periods from 10am to 4pm due to low demand and high renewable output causing high imbalances volumes and a lack of CCGT availability to turn down, with subsidised renewables setting the price.
  3. Bid and offer acceptance volumes increased 82% and 42% to 1171 GWh and 1351 GWh respectively, the highest total since 2016. This was partially due to 21% increase in total wind output in March.
  4. Wind acceptance volumes increased to 439.9 GWh, up from 139.6 GWh previously and making up 38% of accepted bid volumes compared to 17% previously; wind was paid a total of £31 million to turn down.
  5. Though trading hours and number of starts for gas recips increased in March, monthly profits decreased 9% to £872/MW due to reduced wholesale and system prices.

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